Vista Outdoor CEO discusses acquisition of Stone Glacier

Marking its seventh acquisition in the past 16 months, Vista Outdoor has acquired Stone Glacier, an ultra-light hunting and off-road equipment brand based in Bozeman, MT.

Founded in 2012 by Kurt Racicot, Stone Glacier is described on its website as “the result of 15 years of solo sheep hunting from Dall’s country in Alaska to the Boundless Districts of Beartooth Wilderness in Montana”. Winning backcountry fans with its lightweight yet durable gear, Stone Glacier landed on the Inc. List of the 5,000 fastest growing private companies over the past three years.

Racicot, the previous owner, will continue to lead product design while Jeff Sposito, who previously worked for SITKA Gear, will lead Stone Glacier as president.

With Stone Glacier, Vista Outdoor will close calendar year 2021 with six acquisitions, including Fiber Energy Products, a manufacturer of all-natural wood pellets; Foresight Sports, a manufacturer of launch monitors and golf simulators; QuietKat, an electric bicycle company; Venor, a brand of women’s clothing inspired by hunting; and HEVI-Shot ammunition.

Here Vista Outdoor CEO Chris Metz discusses Stone Glacier’s growth potential and Vista’s entry into the packs, camping gear, and technical clothing categories.

Can you tell us about Stone Glacier? Stone Glacier is part of the ultralight and technical backcountry hunting category. So you think of a Sitka with Jason Harrison who first invented the category, then KUIU got down to it. Stone Glacier has an avid following. It was started by an avid hunter in 2012. He then recruited a few people, including the current CEO, and developed a great team. In fact, it’s one of the best-run organizations I’ve seen for a smaller, faster growing business. We think it’s one of those companies that has huge growth ahead of it. They started with very technical packs and hunting and camping gear like tents, bags and packs. They’ve created a crossover with other backcountry enthusiasts who appreciate a lighter weight for their gear. In the last couple of years they’ve turned to clothing and they’ve done a great job. Their fastest growing category is clothing and now accounts for a third of sales. They are based in Bozeman, MT, where many mainstream outdoor product companies are springing up. And three years in a row, they’ve been on the Inc. 5000 list as one of the fastest growing private companies.

What is Stone Glacier’s channel mix? It’s mostly online, but they’re at some retailers across America, like Scheels, which is a big customer. It’s a mixture of about two-thirds, one-third.

Can you share the sales of Stone Glacier? Are they profitable? We are not going to disclose sales for competitive reasons. The company’s revenue isn’t that important to us from a $ 3 billion business disclosure standpoint yet, but it’s growing very, very quickly. It is one of the emerging and best-known brands in the space. If you go out and explore this type of category, you will see it emerge as one of the most exciting brands. They are also profitable.

How did the deal go? Were they for sale? They were not for sale. Like many of our offerings before, we’ve come to know them. I became a personal friend of the owner and CEO because I started using their equipment three or four years ago. And because of that relationship and what they saw from Vista, they became more comfortable with the partnership. If you think about who Vista is today, we’ve become the acquirer of choice for many Founders who want to leverage their strengths with what Vista brings to the party in the outdoor space, and not to sell their brand to. a financial sponsor. They saw us as a very, very exciting home. It took a few years before they started to see some of the other acquisitions that we have made, and now this is our seventh acquisition in the last 16 months, so it is that relationship that has allowed us to purchase this business as we have previous four without having to go to the market.

What opportunity did Vista see at Stone Glacier? What we are seeing is the opportunity to expand into the backcountry hunting and fishing market, which is one of the fastest growing user communities. You think about what happened before COVID, then COVID triggered it where people are looking to get out in the backcountry, whether they’re hunting, skiing, snowshoeing, or just enjoying Mother Nature. It puts us in that category in a much more important way. We haven’t been in backpacks, tents, bags and things of that nature. And where Stone Glacier is different from KUIU and Sitka, for example, it has a strong cross-appeal. From the very beginning, they have appealed to people who are part of different user groups.

How do you plan to climb Stone Glacier? We have 39 brands, ten of which have sales of over $ 100 million, and part of our mantra is to keep the founder’s mindset in these brands. What we love about Stone Glacier is their great product development and a great team. And what we bring to the party is the ability to help them with brand management and marketing. Through our Centers of Excellence, we can help our brands, both online and through distribution, in the way they build and market their brands. Second, we have huge distribution relationships where we can help their teams grow. So we bring a lot to the Stone Glacier team to help them take them to the next level. And that’s what drove them to their limits, is knowing that if they want to be a $ 100 million brand, they have to team up with someone like us to do it.

Can you discuss potential synergies with other Vista brands? One of our sayings is “Better Together”. The first thing we’re going to do is sit down with the CamelBak team and we’re going to sit down with Eagle, Blackhawk, and all of our other brands and we’re going to say, “Where are these synergies? Because these are the same consumers that we get from social marketing and media. We share trends and data from our portfolio so all of our brands are excited to get to know Stone Glacier better and see how we can market, promote and learn from each other.

What will the integration consist of? There will be no change in the management team. Kurt and Jeff are fully committed to the growth of the business and we will partner with them. Kurt is the Product Manager and Chief Design Officer. It has its mark on every new product they make. Jeff basically runs the business. They will stay in Bozeman. In fact, we’re going to be opening a brand new facility over the next six months, a much larger facility that will give them a commercial footprint and more warehouse space. And in the fast growing Bozeman area, they will be one of the employers of choice. In terms of distribution, we are going to be very thoughtful and strategic. One thing we do when we buy brands is we don’t change the way they do their business today. We seek to get to know them better and allow what they do now do better to happen, and then we will make changes as we move forward where we both see the opportunity. We don’t intend to change the way they are marketed just yet, but there will be a handful of selected distributors and retailers that it might make sense to expand it eventually.

Stone Glacier appears to align with many of Vista’s environmental and conservation values. How important is cultural fit? This is the most important thing. We wouldn’t buy a business without a really strong cultural fit. We want people to exhibit behaviors that are consistent with winning teams. We want them to attract good employees. We were named as one of the Best Mid-Size Employers in the US by Forbes this year and it was voted on by our employees. So our people have really embraced the culture and it is important that any business that we introduce exhibits these same types of behaviors and creates a work environment that is diverse and allows us to cross pollinate within our brands. So Stone Glacier fits perfectly into that.

Can you discuss the financing of the operation? We will pay it 100% in cash, and it will have no impact on our leverage ratio. We have little or no debt at this time. We are less than one and a half times in debt and it will have no impact on that.

Is Vista still in capture mode? Do you aim to acquire a certain number of brands each year? This will be the second year in a row that we have generated record cash and profits. Our number one priority is therefore to reinvest in our flagship brands that we have today. I am proud to say that we are driving organic growth across all of our major brands. This is where our cash flow comes first. Second, we have become a big acquirer in the industry with our excess liquidity and we will continue to do so. We have a strong pipeline of acquisitions that we’re looking at, and if you look at the last four we’ve just done in the outdoor space — Fiber Energy, Foresight Sports, QuietKat and now Stone Glacier — with all of them we’ve developed. a strong relationship beforehand and we bought them before they even hit the market. It is not easy to do. But we have established relationships with a number of companies in our pipeline that we are currently reviewing right now. We don’t have a fixed number. It really depends on who is available. And it’s not an easy time to buy businesses. But we will continue to work hard. We have developed a team and an ability to go out and identify companies that fit our culture and that allow us to fit into fast growing categories. The last three deals we made are almost hyper-growth with e-bikes and golf launch instructors and now backcountry hunting and angling. These are fast growing categories for us and we want to continue to do so.

Does the acquisition of Stone Glacier indicate that Vista is looking more to acquire brands in the camping and apparel space? Potentially. We don’t have any specific goals or big ideas for camping and clothing. But the way we do it is that we very carefully enter categories to learn and grow. When we do a bigger transformative acquisition, we will know the space very well, and it will be less of a leap.

Photos courtesy of Stone Glacier

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